Nutthaseth Vanchaichana
Wedbush Securities launched coverage on Tripadvisor (NASDAQ:TRIP) with a Neutral rating and a price target of $17.
Analyst Scott Devitt called Tripadvisor (TRIP) a leader in the planning, destination, and post-trip phases of travel and dining experiences. The company is said to be capturing a global presence across its three main brands.
While growth versus 2019 has been entirely supported by Viator and TheFork, the core Tripadvisor business was noted to remain well below pre-pandemic levels despite healthy post-COVID travel and dining trends. “We believe it will be difficult for Tripadvisor to combat cyclical declines and ongoing competitive challenges affecting the core business,” warned Devitt.
Looking ahead, Wedbush is encouraged by TRIP management’s longer-term strategic focus on further expanding the Viator and TheFork brands, although the firm noted that the ongoing mix shift is putting downward pressure on consolidated margins. The Neutral rating on TRIP is due to the uncertain path forward seen in the company’s primary business against a leisure travel environment that is potentially peaking in North America. The long-term view on TRIP is that the company has the opportunity to improve its platform and leverage the wealth of data and large user base to drive deeper value for advertisers.
Tripadvisor (TRIP) generated revenue growth of 18% with its Q2 earnings report, led by a 59% jump in the Viator segment. Adjusted EBITDA came in at 18% of revenue.
The Seeking Alpha Quant Rating on TRIP is at Hold, with low grades for momentum and revisions holding back the overall score.
Shares of Tripadvisor (TRIP) rose 0.66% in premarket trading.
